Summary
RMO No. 17-2002, issued July 2, 2002, prescribes prerequisites for filing an Application and Joint Certification on tax-free exchanges. It also sets the venue for the Filing Fee and the guidelines for a Preliminary Letter-Ruling.
Key points
- Complete applications only. The BIR Law Division does not accept an application for a BIR certification on the tax consequence of a tax-free exchange unless it is completely filled up, comes with all documents listed in RMO No. 32-2001, and the processing fee is paid.
- Where fees are paid. The transferor/absorbed corporation or the transferee/surviving corporation pays the processing and certification fee with the Revenue District Office or a duly accredited agent bank having jurisdiction over either corporation.
- Amount of fees. The fee is P 5,000, paid in advance, for each application involving not more than ten (10) real properties and/or Certificates of Stock. An additional P 100 is paid for each Transfer Certificate of Title, Condominium Certificate of Title or Certificate of Stock beyond ten (10).
- Preliminary letter-ruling. The Assistant Commissioner, Legal Service (ACIR, LS) issues a preliminary letter-ruling that the request qualifies as a tax-free exchange, on the taxpayer’s written request and under the conditions in the Order.
- No CAR/TCL on the preliminary ruling. No Certificate Authorizing Registration/Tax Clearance (CAR/TCL) is issued for registering the properties with the Register of Deeds on the basis of that preliminary letter-ruling. A CAR/TCL is issued only on the ACIR, LS certification.
Who is affected
- Transferor/absorbed corporations and transferee/surviving corporations in tax-free exchanges
Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.
Copies of BIR issuances are hosted here for reference. For the official version, check bir.gov.ph. Summaries by Tax Resources PH are not a substitute for the full text or professional advice.